Gds Holdings Ltd. · HKEX:9698
Gds — Q4 2016 Earnings Presentation
30 slides from Gds's earnings presentation, Mar 2, 2017
Slide 1: 4Q16 & FY16 Earnings Presentation
4Q16 & FY16 Earnings Presentation 2nd March, 2017 NASDAQ: GDS © GDS 2016 0
Slide 2: Disclaimer
DISCLAIMER This presentation contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such a
Slide 3: Strategic & Operational Highlights
Strategic & Operational Highlights William Huang, Chairman & CEO © GDS 2016
Slide 4: 2016 – A Year of Great Achievement
2016 – A Year of Great Achievement Financial Highlights Operational Highlights n Grew service revenue by 53% Y/Y n Record sales growth with over 25,000 sqm of additional customer commitments n Grew adjusted EBITDA by 64% Y/Y ‒ Worth over US$ 120 mn in annual recurring n Invested Rmb 1.1 bn (US$ 165
Slide 5: Consistent Track Record of Delivery
Consistent Track Record of Delivery Total Net Revenue & Adjusted NOI (Rmb Mn) Total Area Committed & Area Utilized (Sqm) Total Net Revenue 311.7 Total Area Committed Area Utilized 300 70,000 61,043 200 60,000 100 50,000 0 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 40,000 37,082 Adjusted Net Operating I
Slide 6: Biggest Data Center Opportunity in the World
Biggest Data Center Opportunity in the World Cloud Adoption in China Requirement of Cloud Service Providers Cloud Revenues (US$ Bn) 19.0 Large Scale / High Power Density Multi-Market Presence Continuous Resource Supply Rigorous Operating Standards 4.2 3.1 Carrier-Neutral 2.1 1.8 0.9 1.0 2016 2011 20
Slide 7: GDS is Best Positioned to Capture this Opportunity
GDS is Best Positioned to Capture this Opportunity Y/E 2016 Total Area Committed by Customer Segment Highlights n 24.9% market share(1) of carrier-neutral data centers FSI & Enterprises Cloud Service Providers and still rising n GDS is the leading provider for the Top 3 Cloud platforms in China 35.7
Slide 8: Secured Resource Supply to Sustain Leadership
Secured Resource Supply to Sustain Leadership Area In Service & Under Construction (Sqm) Highlights 60,982 96,037 n Net addition of 12,160 sqm to Area In Service during 4Q16 n 25,055 sqm of Area Under Construction at year-end, with 10,000 27.1% pre-committed 14,387 n Acquiring project under construc
Slide 9: Key Objectives for 2017
Key Objectives for 2017 Our Focus Key Objectives for 2017 n Beat our sales achievement in 2016 and keep growing our market share ‒ Deepen our relationships with major Cloud Connecting Cloud players Providers and Enterprises ‒ Add new enterprise logos, leveraging Cloud presence to offer unique value
Slide 10: Financial & Operating Review
Financial & Operating Review Dan Newman, CFO © GDS 2016
Slide 11: 4Q16 P&L Analysis
4Q16 P&L Analysis Quarterly P&L Analysis 4Q16 vs 4Q15 4Q16 vs 3Q16 Rmb ‘000 4Q15 3Q16 4Q16 Y/Y Q/Q n Service revenue grew 55.0% Y/Y RMB RMB RMB % % and 12.3% Q/Q Net Revenue Service Revenue 193,373 266,890 299,731 55.0% 12.3% n Underlying Adjusted NOI excluding Equipment Sales 15,719 30,266 11,938 -
Slide 12: Full Year 2016 vs 2015
Full Year 2016 vs 2015 (1) Revenue (Rmb Mn) Adjusted NOI (Rmb Mn) Adjusted EBITDA (Rmb Mn) 50.1% 48.2% 475.1 270.5 1,056.0 64.3% 703.6 320.5 164.7 FY15 FY16 FY15 FY16 FY15 FY16 Note: 1. Equipment sales of Rmb 52.9 mn in 2016 and Rmb 50.0 mn in 2015; equipment cost of Rmb 46.2 mn in full year 2016 an
Slide 13: Revenue & Area Utilized
Revenue & Area Utilized Revenue (Rmb Mn) Area Utilized (Sqm) Service Revenue Equipment Sales End of Period 11.9 37,082 30.3 34,369 32,152 2.0 15.7 8.7 23,957 22,365 299.7 266.9 234.0 193.4 202.4 4Q15 1Q16 2Q16 3Q16 4Q16 4Q15 1Q16 2Q16 3Q16 4Q16 n Service revenue increased by 55.0% Y/Y, 12.3% Q/Q n A
Slide 14: Adjusted EBITDA & Margin
Adjusted EBITDA & Margin Adjusted EBITDA (Rmb Mn) & Margin 4Q16 Cost Breakdown & Operating Leverage (Rmb Mn) 23.1% 25.3% 20.0% 26.2% 29.5% Equipment Sales Total Net Revenue 11.9 299.7 311.7 92.0 23.2% Utility Cost 69.5 of Service Revenue 78.0 Rent, Labour & Other (1) 90.3 Equipment Cost 10.8 53.4 Eq
Slide 15: Capex & On-Going Investment
Capex & On-Going Investment Capex Incurred (Rmb Mn) Capex & On-Going Investment Capex Breakdown as at 31/12/16 Rmb Mn Cost to Date Cost to Complete Area In Service 2,999.4 293.2 2015 731.9 Area Under Construction 269.3 1,105.8 Current Construction Program (1) 2016 213.3 263.6 386.9 283.3 1,147.1 Are
Slide 16: Financing Obligation & Liquidity
Financing Obligation & Liquidity Debt & Cash Outstanding Loan Maturity Schedule as of 31/12/16 (Rmb Mn) 1,425.9 Rmb Mn 31/12/15 30/9/16 31/12/16 Loan Loan Convertible Bond Working Capital 309.8 252.1 239.8 1,040.5 Project Loan 876.9 1,530.5 1,698.8 628.5 359.2 412.4 Mezzanine Debt 199.8 199.6 199.6
Slide 17: Contract Backlog Build-up
Contract Backlog Build-up Total Area Committed & Area Utilized (Sqm) Highlights Total Area Committed Area Utilized n 22,997 sqm of contract backlog pro forma for the 61,043 churn at the end of 4Q16 58,627 - 16,212 sqm relates to Area In Service Backlog 44,614 22,997 - 6,785 sqm relates to Area Under
Slide 18: 2017 Business Outlook
2017 Business Outlook FY17 Guidance Rmb Mn FY16 FY17 Guidance Implied Y/Y Service Revenue 1,003.0 1,475 – 1,575 +47% – 57% Adjusted EBITDA 270.5 465 – 495 +72% – 83% Capex 1,147.1 ~1,800 ~ +57% © GDS 2016 17
Slide 19: Questions & Answers
Questions & Answers www.gds-services.com ir@gds-services.com © GDS 2016
Slide 20: Appendix
Appendix © GDS 2016
Slide 21: Key Operating KPIs
Key Operating KPIs Key Operating KPIs As at the end of 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 Area In Service (Sqm) 27,589 27,589 37,645 37,869 37,869 48,548 48,822 60,982 Area Under Construction (Sqm) 14,364 14,364 13,163 35,525 35,525 31,794 37,194 25,055 Area Committed (Sqm) 21,942 22,599 31,794
Slide 22: Self-Developed Data Centers In Service
Self-Developed Data Centers In Service As At 31/12/16 Shanghai Shenzhen Guangzhou Beijing Chengdu CD1 KS1 SH1 SH2 SH3 SZ1 SZ2 SZ3 GZ1 BJ1 Phase 1 & 2 Ready For Service 2H10 2H11 2H15 2H16 2H14 1H16 2H16 1H16 2H15 1H11 / 2H16 Type Purpose-Built Purpose-Built Purpose-Built Purpose-Built Converted Conv
Slide 23: Self-Developed Data Centers Under Construction
Self-Developed Data Centers Under Construction As At 31/12/16 Shanghai Shenzhen Beijing Chengdu SZ4 CD1 SH4 BJ2 Phase 1 Phase 3 Ready For Service 2H17 1H17 2H17 1H17 Type Purpose-Built Converted Converted Purpose-Built Tenure Leased Leased Leased Owned Area Under Construction (Sqm) 8,210 5,268 6,177
Slide 24: Top Customers
Top 5 Customers Top 5 Customers in terms of Total Area Committed Number of Data End User Total Area Committed % (1) 4Q2016 Revenue % Center(s) Internet / Cloud Service Provider 24.8% 23.1% 5 Internet / Cloud Service Provider 20.3% 6.6% 9 Internet 9.5% 13.1% 1 Cloud Service Provider 5.5% 0% 2 Interne
Slide 25: Shares Outstanding
Shares Outstanding As At 31/12/16 Shares Outstanding as at 31/12/16 (1) Ordinary Shares from before IPO 217,987,922 Ordinary Shares Converted from Preferred Shares 349,087,677 Ordinary Shares Issued for Preferred Dividends 31,490,164 Ordinary Shares Issued in IPO (Including Greenshoe) 160,565,880 Or
Slide 26: FY16 P&L Analysis
FY16 P&L Analysis Full Year P&L Analysis Rmb ‘000 FY15 FY16 2016 vs 2015 RMB RMB % n Service revenue grew 53.5% Net Revenue n Underlying Adjusted NOI excluding Service Revenue 653,591 1,003,015 53.5% Equipment Sales 50,045 52,945 5.8% equipment profit grew 56.1% Total Net Revenue 703,636 1,055,960 5
Slide 27: Historical Financial Results: Statement of Operations
Historical Financial Results Condensed Consolidated Statement of Operations Amounts in thousands For the Three Months Ended, For Year Ended Dec 31, 2015 Mar 31, 2016 Jun 30, 2016 Sep 30, 2016 Dec 31, 2016 Dec 31, 2015 Dec 31, 2016 RMB RMB RMB RMB RMB USD RMB RMB USD Net Revenue Service revenue 193,3
Slide 28: Historical Financial Results: Balance Sheets
Historical Financial Results Condensed Consolidated Balance Sheets As of Dec 31, As of Dec 31, As of Jun 30, As of Sep 30, Amounts in thousands As of Dec 31, 2016 2014 2015 2016 2016 RMB RMB RMB RMB RMB USD Cash 606,758 924,498 834,477 798,732 1,811,319 260,884 Accounts receivable, net of allowance
Slide 29: Historical Financial Results: Cash Flow Statement
Historical Financial Results Cash Flow Statement Six Months Amounts in thousands Year Ended Three Months Ended Year Ended Ended Dec 31, 2014 Dec 31, 2015 Jun 30, 2016 Sept 30, 2016 Dec 31, 2016 Dec 31, 2016 RMB RMB RMB RMB RMB USD RMB USD Net cash provided by (used in) operating activities 27,937 (8
Slide 30: Reconciliation from Net Loss to Adjusted EBITDA
Reconciliation from Net Loss to Adjusted EBITDA Adjusted EBITDA Amounts in thousands For the Three Months Ended For Year ended Dec 31, 2015 Mar 31, 2016 Jun 30, 2016 Sep 30, 2016 Dec 31, 2016 Dec 31, 2016 Dec 31, 2015 Dec 31, 2016 RMB RMB RMB RMB RMB USD RMB RMB USD Net loss (28,175) (38,778) (115,4